19 of the biggest councils break NSW Government levy cap

09 September 2009

Nineteen local councils are defying a NSW Government cap on local council charges and are levying as much as $80,000 a home, according to figures released by the Urban Taskforce today.

One council even wants to impose a new levy to raise up to $187 million in new revenue. The Taskforces chief executive, Aaron Gadiel, said that NSW council levies were crippling efforts to get privately funded building re-started.


In December 2008, the NSW Government said it was capping infrastructure contributions payable to local councils at $20,000 per lot.


Seven councils are still imposing a levy of $50,000 or more on new homes – in defiance of the NSW Governments announcement Mr Gadiel said.


Yass Valley Council has the states highest levy with an impost of $80,000 per home.


Sydneys highest-taxing council is Pittwater, where the charge is now $62,000 a home.


Camden Council charges $59,000 a home while Ku-ring-gai and The Hills both charge $54,000 a home.


Hawkesbury Council levies new homes at a rate of $51,000 each while Shoalhaven Council charges $50,000.


Twelve other councils are charging well above the state governments $20,000 cap, including Blacktown ($44,000), Campbelltown ($41,000), Leichhardt ($40,000), Wyong ($35,000), Liverpool ($31,000) and the City of Sydney ($27,000).


These charges have crippled efforts to build new houses on the metropolitan areas edge.


The City of Sydneys charge on apartment development is unjustifiable and makes it hard to build affordable apartments close to public transport.


Burwood is currently proposing a new levy on local development activity, including new homes and commercial office development.


The levy will add 4 per cent to project costs and is supposed to raise up to $187 million Mr Gadiel said.


This is an unheard of revenue grab by a small suburban council.


It will kill any prospect of serious urban renewal around the Burwood town centre.


Mr Gadiel said that NSW was in the grip of its most serious housing shortage since World War II.


Local councils have literally been chasing developers away, he said.


These levies make housing too expensive for many ordinary home buyers.


As a result, many developers have avoided NSW and instead move interstate.


For every NSW resident, the state attracts just $1.02 in new private sector residential construction investment each year.


Our nearest comparable states attract double the investment – Victoria receiving $1.91 for every resident and Queensland securing $2.15.


The extent of our growing housing crisis is clear. In NSW 35 new homes are built each year by the private sector for every 10,000 residents in the state.


In Victoria, for every 10,000 of its residents, 75 new homes are built annually.


In Queensland for every 10,000 residents, 76 homes are built.


Its essential that local councils accept their share of the blame for the massive shortfall in housing development.


They must quickly move to bring their charges under the state government’s $20,000 cap.


The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.


For every $1 million in construction expenditure, 27 jobs are created throughout the broader economy. The construction activity made possible by property developers contributes $69 billion to the national economy each year and creates 709,000 direct jobs. The construction industry is Australias third largest source of employment.

A table showing all 19 councils and their charge is in the attached PDF below.



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